Correlation Between Home Invest and Immolease Trust

Can any of the company-specific risk be diversified away by investing in both Home Invest and Immolease Trust at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Home Invest and Immolease Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Home Invest Belgium and Immolease Trust NV, you can compare the effects of market volatilities on Home Invest and Immolease Trust and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Home Invest with a short position of Immolease Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Invest and Immolease Trust.

Diversification Opportunities for Home Invest and Immolease Trust

0.58

Correlation Coefficient

Home Invest  Immolease Trust

Very weak diversification

The 3 months correlation between Home and Immolease is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Home Invest Belgium and Immolease Trust NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immolease Trust NV and Home Invest is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Home Invest Belgium are associated (or correlated) with Immolease Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immolease Trust NV has no effect on the direction of Home Invest i.e., Home Invest and Immolease Trust go up and down completely randomly.

Pair Corralation between Home Invest and Immolease Trust

Assuming the 90 days trading horizon Home Invest Belgium is expected to under-perform the Immolease Trust. In addition to that, Home Invest is 1.06 times more volatile than Immolease Trust NV. It trades about -0.18 of its total potential returns per unit of risk. Immolease Trust NV is currently generating about -0.17 per unit of volatility. If you would invest  11,800  in Immolease Trust NV on September 12, 2024 and sell it today you would lose (1,200) from holding Immolease Trust NV or give up 10.17% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	63.08%
Values	Daily Returns

Home Invest Belgium  vs.  Immolease Trust NV

Home Invest Belgium

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Home Invest Belgium has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Immolease Trust NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Immolease Trust NV has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Home Invest and Immolease Trust

The main advantage of trading using opposite Home Invest and Immolease Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Invest position performs unexpectedly, Immolease Trust can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Immolease Trust will offset losses from the drop in Immolease Trust's long position.

The idea behind Home Invest Belgium and Immolease Trust NV pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.